HC Deb 22 September 1971 vol 823 cc157-68

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Fortescue.]

10.0 p.m.

Mr. Ray Carter (Birmingham, Northfield)

I have been extremely fortunate in obtaining the opportunity on the Adjournment to raise the subject of the unemployment of school leavers in the City of Birmingham. In doing so, I do not for a moment want to create the impression that the problems of Birmingham in this connection are any different from any other city or region in the country. In fact there is a vast number of cities, regions and areas throughout the country which are experiencing far worse difficulties than Birmingham. Therefore, what I say tonight on the unemployment of school leavers, whilst I refer specifically to Birmingham and its problems, should be seen in the context of a nationwide problem. Birmingham's sympathy goes out to those regions of Scotland—indeed, Northern Ireland which we have just been debating—Wales and the North-East which have desperate problems, because thousands of young people who left school this year are still unable to find work. Indeed, in many cases some young people have been out of work not one or two years but three years. Some have not even found their first job.

Before leaving the national picture I should like to read out the figures which obtained in August last. They will give some idea to the House of the national position. In August last there were 97,146 unemployed young people under 18. Of those, 55,525 were school leavers. That is a tragic total. Unemployment for anybody at any time in his life is indeed tragic. But for a young person leaving school unemployment means rather more. He has been trained to go out and earn a living and has suddenly arrived at that point in life where he is about to assume adult status. Therefore, he wants to go out and enjoy immediately the prospects which have been held out to him during his nine or ten years at school. Those 55,000 young people who left school and did not find jobs have been scarred for life. They cannot erase the experience which they have had. They have been trained at school over a long period and have gone out into a hostile world.

On Sunday last I led a march of young people in the City of Birmingham. Some were employed, but many of them fell into the category of school-leavers who have not been able to find jobs. We had a meeting—not too big a meeting; should like to have seen it better supported—at which some heart-rending tales were told. There were young people with a wide range of abilities, some with o-levels and others with C.S.E.s. Indeed, one young chap with eight C.S.E.s had been unemployed for a year. This was in the City of Birmingham, the heartland of British industry, where, until a few months ago, a wide range of employment opportunities were available to that young man. That march symbolized, for me at least, the problems that Birmingham faces as regards employment and more particularly as regards the unemployment of young people.

I have pursued this subject for some months. An Early Day Motion of mine, which has attracted more than 260 signatures from hon. Members on both sides, urges the Government to take action to safeguard the future employment prospects of ½ million school-leavers who were due to enter the labour market in July of this year. Therefore, the Government cannot claim that the subject was not brought to their attention sufficiently early.

I have written to the Prime Minister and I have raised the matter with the Secretary of State for Employment and his junior Ministers and tabled numerous Questions. Therefore, I can claim in this debate to have brought the matter fully to the attention of the appropriate people at the appropriate time and sufficiently early.

The Prime Minister—I pay credit to him here—wrote me a very detailed letter running to six pages but at the end of the day he did not offer any solution, nor did the Secretary of State for Employment and his junior Ministers.

This is an appropriate day for this debate, because today in Birmingham the latest unemployment figures were announced. It is becoming something of an unwanted habit in Birmingham that month by month the unemployment figures rise. I am sad to say that today is no exception. There was another increase in unemployment.

The number of young persons unemployed in the City of Birmingham is listed as 2,005, but that does not give the complete picture. To find the complete picture of the problems of unemployment amongst school-leavers it is necessary to look at the very detailed survey carried out by the careers guidance department which gave a very accurate and clear breakdown of the position as regards school-leavers.

That survey was received by the Chairman of the Education Committee in Birmingham—a Conservative—who, having read it, said that the city was faced with a very real emergency; because, apart from those young people who, having left school, are registered as unemployed, the careers guidance department knows that more than 2,000 children who left school in July are still seeking employment but have not as yet registered as unemployed, still less are they seeking unemployment benefit. Taking these young people into account, it is no exaggeration to say that there are now over 1 million unemployed in Britain.

Much work is necessary in the field of statistics, because it has emerged in my investigations that not much is known about the whereabouts of a large percentage of school-leavers—people who left school only last July. It has also emerged from the survey that three times more young people are receiving unemployment benefit this year than received it last year. The number of known unemployed young people and those who are seeking jobs but have not registered is further increased in that more young people are staying on at school because they cannot find jobs.

The Minister will no doubt deny that Government economic policies have been responsible for this sad state of affairs. The Prime Minister is apt to claim that his policies will ultimately restore our economic prosperity. Meanwhile, he must accept that those policies have caused firms, among other things, to reduce their intake of apprentices. This fact is also borne out by the careers guidance survey. Many firms have been cutting their training schemes, some drastically and some completely.

The Government have called for action, but in my view they have shown alarming complacency, particularly bearing in mind the prior warning they had about what would happen when half a million young people came on to the labour market in July. I wrote to the Secretary of State about this, and the Minister of State told me in a letter dated 29th July, 1971: There is a danger that if exaggerated statements are made about the seriousness of the situation, they may cause school-leavers to grab at any job no matter whether or not it is suitable. There is no need for this in the present circumstances in Birmingham, and such action could adversely affect a young person's future career. But the jobs are not there. I could not have said anything which would have adversely affected a young person's future opportunities and prospects. On the contrary, if more people had paid attention to those warnings, perhaps the Government would have taken earlier action. It is clear, however, that the Government were, and still are, completely out of touch with the reality of the situation.

The Government have made a number of appeals. In one letter from a junior Minister I was given a Press release which detailed an appeal which the Secretary of State for Employment had made on 15th July last to the National Youth Employment Council. He had, according to the Press release, appealed to employers not to reduce their intake of young persons this year.

His appeal was of no avail. One of Britain's major manufacturers in Birmingham reduced its apprentice intake by one-half. I wrote to the managing director of this firm drawing his attention to the appeal made by the Secretary of State and urging him to reconsider his company's decision. He replied, in effect, "I am very sorry, but I must act in the best interests of my company. We must operate economically." He was right to reply in those terms. It is clear that he cannot consider the community interest, particularly when in power are a Government who follow the sort of economic policies I have been describing and whose lame duck philosophy does not encourage a community spirit on the part of private enterprise.

I have also drawn to the attention of the Department of Employment the action of another company in completely cutting its training scheme. I will not weary the House by quoting from the letter which I sent to the Department on this subject. It was a vain attempt to get something done. So much for the appeals made by the Minister and others.

The latest unemployment figures will be out tomorrow. It is unfortunate that neither I nor the Under-Secretary of State will be able to use them in this debate, but the Birmingham figures coming out today show an increase—and here the Minister will have an affinity of interest with me on this subject because he, too, is a Midland Member. Those figures have gone up and, in this field, as Birmingham goes so goes the country.

I think that we are reasonably inclined to accept that tomorrow's national figures will show an increase. There may be a marginal decrease in the figures the Department has for school leavers, but bearing in mind that the statistics in this field could be much improved, and one cannot treat them with a great deal of accuracy, one should not place too much reliance on them. What is sure is that when the figures are announced tomorrow they will show that there is a very large number, an unhealthily large number, of young people still standing in the dole queues.

I ask the Under-Secretary to urge his colleagues to consider two possible courses of action to remedy the situation. First, and this applies not just to Birmingham but to the whole country, I urge the Government to consider the infusion of large sums of public money, via the local corporations and other bodies, which can create employment opportunities and which can, after having circulated through the local economy, stimulate employment prospects.

Secondly, and this is probably more important for young people, I urge the Minister, the Department and the Secretary of State to give very serious consideration at the earliest opportunity to increasing Government assistance not only to the industrial training boards but to various other training establishments, and even perhaps to local colleges of education which could stimulate immediately the number of apprentices and young people who can enter training schemes. We need that kind of emergency action to deal with what the Conservative chairman of my local education authority has described as a very real emergency.

I ask the Government and the House tonight to remember that although the level of unemployment inside Birmingham is only 4 per cent., to every person who is unemployed—and this particularly applies to young people—the percentage of unemployment is not 4 per cent. but 100 per cent.; and that that young person, having entered a totally hostile world and having been completely rejected, is scarred for life. I hope, therefore, that the Government will listen to my appeal, and take some urgent action to remedy this very distressing situation.

10.18 p.m.

The Under-Secretary of State for Employment (Mr. Dudley Smith)

It may be said in fairness that the increase in general unemployment in Birmingham for last month is due very largely to an increase of some 12,000 in the number of temporarily stopped workers—

Mr. Carter

No.

Mr. Dudley Smith

They were those who were on strike, and the majority were involved in the dispute at Lucas's. If we leave aside the temporarily stopped, the unemployment rate of wholly unemployed is 3.7 per cent. in Birmingham.

In recent months the hon. Member for Birmingham, Northfield (Mr. Carter) has shown special interest in the problem of unemployment among young people, and I want, if I can, to assure him, as a Midland M.P. myself, that the Government and I share the concern that has been expressed. While I shall in a moment give the latest statistics, I am very conscious that the unemployed, whether young or old are not just some figures or numbers. We are discussing a very real and human problem.

I can readily understand the sense of disillusion and frustration of boys and girls who look forward to leaving school and starting out in life only to find that there is not, in current circumstances, a job available for them. There can be no doubt that the present level of unemployment is too high, and too high among young people. We have never disguised that fact. I would again assure the House that we are utterly determined to halt and then to reverse the upward trend in unemployment. Contrary to what the hon. Member said, there is certainly no complacency on the Government benches about unemployment or the need to tackle it thoroughly and well.

Turning to the current position in Birmingham, on 13th September there were 2,006 unemployed young people under 18 in the Birmingham County Borough and Sol hull. Sol hull is included in all the figures I shall give because many Sol hull young people seek work in Birmingham, as the hon. Member knows. In the area unemployment among young people is at about twice the level that it was in September last year. Notified vacancies stand at 923, compared with 1,695 at this time last year. Of the 2,006 unemployed in the area, 790 were school leavers. We estimate that some 9,000 young people left school for employment in the Birmingham/Solihull area at the end of this summer term. So it appears that of all the school leavers, something like 9 per cent. were left registered as unemployed and waiting for their first job by 13th September. Last year approximately the same number of young people left school and 358, about half of the 1971 figure, were registered for employment in September.

The hon. Gentleman argues that these figures understate the position. He suggested that there may be many who have gone back to school because of the lack of a job. I am afraid that I cannot give any reliable figures on this. They are not available from the schools, and in any case it would be very difficult to pin- point in each case the overriding reason why a young person returned to full-time education.

The hon. Member has also suggested that there may be many young people unemployed but also unregistered. There are, as he knows, considerable incentives to register, both in terms of financial benefits in some cases and in terms of information about vacancies. If, however, he has any concrete evidence that unemployed young people are not registering I should be very glad to look at it and I hope that he will send me that information.

Mr. Carter

Before the hon. Gentleman leaves that point, there is available the evidence produced by the careers guidance survey published last week which shows that over 2,000 school leavers are still unaccounted for and still looking for a job.

Mr. Dudley Smith

I will certainly look at that, but the best advice I have received is that there are no really reliable figures on this subject at present. If the hon. Gentleman has any other information, we shall be only too pleased to hear from him.

Altogether—and one accepts this—the unemployment position of school leavers and young people generally in the Birmingham and Sol hull area is less favourable than it was last year. There have been redundancies in engineering and other industries affecting apprentices and other young employees and affecting recruitment of new employees. But at present, I am glad to say, vacancies are still coming into the careers offices and an improvement is expected as students return to university and some of their jobs are taken by young people.

Last year there was a considerable drop in unemployment from September onwards and there is no reason to doubt that this will happen again this year as trade picks up in anticipation of Christmas demands and as a result of the effect of the economic measures which my right hon. Friend the Chancellor of the Exchequer has adopted.

I am confident that of the 790 school leavers still seeking work at present in Birmingham, the great majority are likely to obtain work within the next four to six weeks.

I turn to the action being taken to alleviate the problem of unemployment among young people both in the Birmingham area and, as the hon. Gentleman quite rightly mentioned, in the country as a whole. First and foremost, there are the various economic measures I have referred to which the Chancellor announced in July and which should certainly stimulate renewed activity in a great industrial conurbation like Birmingham.

The reductions in purchase tax and the abandonment of controls on hire purchase have already had a marked effect on registrations of motor cars. This is an industry of special significance to the West Midlands generally, and to Birmingham in particular, and the increase in the number of car registrations was noticeable immediately following my right hon. Friend's announcement. This increase was maintained during August, and there is every indication that the upward trend is being maintained in September.

The hon. Gentleman has suggested, I believe in an interview outside the House, that we should relax control on the issue of I.D.C.s to Birmingham.

Mr. Carter

No.

Mr. Dudley Smith

I am sorry if I have misquoted the hon. Gentleman, but this is an issue which has been canvassed by many people, and the Birmingham Post referred to it in an article today. All I need say on that is that this is a matter for the Department of Trade and Industry. There are popular misconceptions about this because, in fact, a large proportion of I.D.C. applications in the West Midlands is granted. The Government, cannot, however, ignore the need to encourage mobile industry to move to areas where unemployment is persistently and chronically higher than it is in the Birmingham area.

A second step which we have taken, and to which the hon. Gentleman referred, was the appeal by my right hon. Friend the Secretary of State for Employment in July to employers who were contemplating a cut back in recruitment to think again, and I am glad to say that the appeal was strongly endorsed by the C.B.I. The hon. Gentleman poured a certain amount of cold water on this. It is only fair and proper to say that it is still too early to know exactly how successful that appeal has been, but we are watching the trends very carefully.

Careers officers in Birmingham, as in the country generally, have been doing all they can to canvass employers for vacancies and to see that young people get the greatest possible benefit from what opportunities are available. I should like to say that Birmingham is fortunate in the high quality and dedication of its Youth Employment Service.

In this situation, it is important that vacancies are not left unfilled in one area when there are suitable unemployed people elsewhere. The Chairman of the Central Youth Employment Executive has recently drawn the attention of all careers officers to the importance of circulating vacancies which cannot be filled locally.

The Government have agreed to meet half the cost of schemes of various industrial training boards to make up part of the shortfall in apprentice training this year.

Altogether 60 places were allocated to Birmingham under the training awards scheme of the Engineering Industry Training Board, and all but four of these have been filled to date. Recruitment for 22 places for the Road Transport Training Board scheme is still in progress.

The hon. Gentleman suggested that the Government should make funds available to the industrial training boards to encourage an increase in the number of apprenticeships. In fact, considerable funds are being made available to the boards for the awards schemes recently announced, and I promise that we shall keep this situation actively under review. In fact, we are doing so.

I can tell the House that, in view of the likelihood that there will be a higher level of unemployment among young people in Birmingham this winter than in the past, consideration is being actively given to the possibility of starting semi-skilled training courses at colleges of further education or in employers' establishments. These courses would either be exclusively for young people or for adults as well.

In conclusion, may I say that Birmingham is in a difficult situation at the moment, but I believe that most of those who are school leavers this year will find themselves in employment in the next four to six weeks. This is a continuing problem, and it is one over which we shall show no complacency.

The hon. Gentleman called for a massive infusion of public expenditure to stimulate industry. I do not think that that is what Birmingham wants or needs. It does not require artificial stimulation. What is needed is the creation of an economic climate in which industry can see its way to grow and develop. This cannot happen when managements live in constant fear of rising costs setting their plans at nothing. That is why the Government have concentrated on measures to restore confidence in industry. The results should soon begin to show and Birmingham, I submit, is especially well placed—.

The Question having been proposed at Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at half-past Ten o'clock.